Biotechnology is one of many industries benefiting from the new AZ R&D Credit
On May 11th, Arizona Governor Jan Brewer signed into law SB 1254, modifying the Arizona research and development (R&D) tax credit. The change in the R&D tax credit will allow small businesses in Arizona that qualify and apply for R&D tax credits to receive as a refund 75% of the R&D credits generated.
Randy Eickhoff, President, Acena Consulting, "This is a signficant change to an important incentive for Arizona companies. In today's market, it isn't enough for a company to create a good product. Today, innovation that creates new products, improves on old products and opens new markets as a part of a growth strategy is paramount to staying competitve. It is important for Arizona's government to support the people driving their economy and the R&D tax credit improvement demonstrates that support."
The new law will take effect for tax years beginning after December 31, 2009 and will be limited to $5 million per year. The refund opportunity must be submitted to the Department of Commerce for qualification and approval and is available for companies with less than 150 employees. R&D Credits apply to companies developing or improving on products, processes, formulas, software, techniques or inventions. As such, industries impacted by this change will include Aerospace/Defense, Healthcare, Technology, Semiconductor, Agriculture, Manufacturing, Software, Capital Equipment and Engineering-
With one of the most lucrative R&D tax credits in the US, Arizona has seen significant success in its utilization by both businesses and individual taxpayers. According to the Department of Revenue, in 2007, 185 corporate taxpayers claimed $43.8 million while 161 individual taxpayers claimed $2.6 million in R&D credits.
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